That’s to say that before “structural problems” became a conservative talking point used to dismiss the idea of fiscal or monetary stimulus, it was progressives who were inclined to see serious structural problems underlying the American economy. Neither Obama nor Hillary Clinton nor John Edwards was running for president on a platform of “let’s reform the health care system and hope there’s no negative shock to aggregate demand.” They did want to reform health care, but they also claimed to see a fairly deeply rooted economic malaise. In retrospect, it seems to me that mainstream Democrats were actually missing the biggest problem with Bush-era economic management — inadequate supervision of the financial services sector. Not everyone overlooked this, my old boss Bob Kuttner was way ahead of the curve, but as I think he’d be the first to tell you, other people weren’t leaping at the opportunity to talk about this.

At the time, my own view was that a lot of this progressive concern about alleged long-run stagnation in living standards was overstated and that “health reform + hope there’s no negative demand shock” actually was an adequate economic agenda. Then we had a serious climate change problem, etc. At the time, that was me holding a centrist sellout view. Then came the recession and suddenly “let’s talk a lot about demand” became coded as a left-wing position, while “let’s talk a lot about structural problems” became coded as a centrist or conservative position. But there’s a continuity here in the underlying issue. My view is that having lots of Americans work in the building trades is a perfectly reasonable and acceptable response to the combination of Chinese people’s increased ability to make stuff that can be packed in boxes, and the Chinese government’s determination to subsidize American consumption of Chinese-made goods. The problem isn’t that we had too many people working in construction five years ago, it’s that we don’t have enough people working in construction today.

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